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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Nexstar Media Group Inc | NASDAQ:NXST | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 166.97 | 157.35 | 167.75 | 0 | 09:05:21 |
Q2 Net Revenue Drives Net Income of $106 Million, Adjusted EBITDA of $398 Million and
Adjusted Free Cash Flow of $78 Million
All-Time High Second Quarter Distribution Revenue
Reduced Year-over-Year Quarterly Losses at The CW by $33 Million
Quarterly Return of Capital to Shareholders of $190 Million, Reducing Shares Outstanding by 1.7%
Nexstar Media Group, Inc. (NASDAQ: NXST) (“Nexstar” or the “Company”) today reported financial results for the second quarter ended June 30, 2024 as summarized below. Please visit Nexstar’s website to view the full press release.
STATEMENT FROM PERRY A. SOOK, FOUNDER, CHAIRMAN AND CEO
“Nexstar delivered another period of solid financial results, building on our strong start to the year. Following a first quarter in which Nexstar generated record first-quarter distribution and total net revenue, we did it again, generating our highest-ever second-quarter distribution and total net revenue. During the quarter, we continued executing on our plan at The CW, reducing operating losses by $33 million year-over-year and $83 million year-to-date as our organizational and programming changes are driving improved cash flows and the third consecutive quarter of ratings growth in primetime entertainment programming. Overall, our strong year-to-date operating performance yielded $483 million of Adjusted Free Cash Flow and we returned $358 million, or 74% of Adjusted Free Cash Flow, to shareholders in the form of dividends and share repurchases. Looking ahead, we expect to benefit from anticipated record levels of political spending on broadcast television in the second half of the year.”
2024 Second Quarter Financial Summary
($ in millions)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
% Change
2024
2023
% Change
Distribution
$734
$696
5.5
$1,495
$1,424
5.0
Advertising
522
511
2.2
1,034
1,028
0.6
Other
13
33
(60.6
)
24
45
(46.7
)
Net Revenue
$1,269
$1,240
2.3
$2,553
$2,497
2.2
Net Income
$106
$75
41.3
$273
$163
67.5
% Margin(1)
8.4%
6.0%
2.4
10.7%
6.5%
4.2
Adjusted EBITDA(2)
$398
$335
18.8
$941
$831
13.2
% Margin(1)
31.4%
27.0%
4.4
36.9%
33.3%
3.6
Adjusted Free Cash Flow(2)
$78
$74
5.4
$483
$451
7.1
(1) Net Income margin is Net Income as a percentage of Net Revenue. Adjusted EBITDA margin is Adjusted EBITDA as a percentage of Net Revenue.
(2)
Definitions and disclosures regarding non-GAAP financial information including reconciliations are included at the end of the press release. In the first quarter of 2024, we adjusted our definition of Adjusted EBITDA to add back stock-based compensation expense and restructuring expenses and to subtract out pension credits. We also adjusted our definition of Adjusted Free Cash Flow (formerly referred to as Attributable Free Cash Flow) to subtract out pension credits and payments for capitalized software obligations and to adjust for actual cash contributions from noncontrolling interests in lieu of adjusting for our partners’ share of losses in The CW. The comparative prior year disclosures were also recast to conform with the current presentation.Company and Business Highlights
Financial Highlights
Financial Highlights (continued)
Capital Allocation
($ in millions, shares in thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Cash Used For
Debt repayment
$31
$31
$61
$62
Acquisitions
-
-
-
-
Stockholder return
190
189
358
413
Common stock dividends
55
48
112
98
Stock repurchases
135
141
246
315
Shares Outstanding
End of period
32,486
35,381
32,486
35,381
Less: Beginning of period
33,038
35,984
33,601
36,810
Change in shares outstanding
(552
)
(603
)
(1,115
)
(1,429
)
% Change
(1.7%
)
(1.7%
)
(3.3%
)
(3.9%
)
Debt, Cash and Leverage
($ in millions)
June 30, 2024
December 31, 2023
Unrestricted Cash
$146
$135
Revolving Credit Facilities
$62
$62
First Lien Term Loans
4,008
4,064
5.625% Senior Unsecured Notes due 2027
1,717
1,717
4.75% Senior Unsecured Notes due 2028
994
994
Total Debt
$6,781
$6,837
Second Quarter Conference Call
Nexstar will host a conference call at 10:00 a.m. ET today. Senior management will discuss the financial results and host a question-and-answer session. The dial in number for the audio conference call is +1 877-407-9208 or +1 201-493-6784, conference ID 13747205 (domestic and international callers). Participants can also listen to a live webcast of the call through the “Events and Presentations” section under “Investor Relations” on Nexstar’s website at nexstar.tv. A webcast replay will be available for 90 days following the live event at nexstar.tv.
Forward-Looking Statements
This communication includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Forward-looking statements include information preceded by, followed by, or that includes the words "guidance," "believes," "expects," "anticipates," "could," or similar expressions. For these statements, Nexstar claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this communication, concerning, among other things, future financial performance, including changes in net revenue, operating expenses and cash flow, involve risks and uncertainties, and are subject to change based on various important factors, including the impact of changes in national and regional economies, the ability to service and refinance our outstanding debt, successful integration of business acquisitions (including achievement of synergies and cost reductions), pricing fluctuations in local and national advertising, future regulatory actions and conditions in the television stations' operating areas, competition from others in the broadcast television markets, volatility in programming costs, the effects of governmental regulation of broadcasting, industry consolidation, technological developments and major world news events. Nexstar undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this communication might not occur. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this release. For more details on factors that could affect these expectations, please see Nexstar’s other filings with the Securities and Exchange Commission.
Definitions and Disclosures Regarding Non-GAAP Financial Information
Adjusted EBITDA is calculated as net income, plus or (minus): transaction and other one-time expenses, stock-based compensation expense, depreciation and amortization expense (excluding amortization of broadcast rights for The CW), (payments) for broadcast rights (excluding broadcast rights payments for The CW), (gain) loss on asset disposal, impairment charges, interest expense, net, (income) loss from equity method investments, cash distributions from equity method investments, pension and other postretirement plans costs (credit), income tax expense (benefit) and other expense (income). We consider Adjusted EBITDA to be an indicator of our assets’ operating performance and a measure of our ability to service debt. It is also used by management to identify the cash available for strategic acquisitions and investments, maintain capital assets and fund ongoing operations and working capital needs. We also believe that Adjusted EBITDA is useful to investors and lenders as a measure of valuation.
Adjusted Free Cash Flow is calculated as net income, plus or (minus) transaction and other one-time expenses, stock-based compensation expense, depreciation and amortization expense (excluding amortization of broadcast rights for The CW), (payments) for broadcast rights (excluding broadcast rights payments for The CW), (gain) loss on asset disposal, impairment charges, interest expense, net, (income) loss from equity method investments, cash distributions from equity method investments, pension and other postretirement plans costs (credit), income tax expense (benefit) and other expense (income) minus cash interest expense, capital expenditures, payments for capitalized software obligations and operating cash income tax payments, plus proceeds from disposal of assets and insurance recoveries and cash contribution from noncontrolling interests. We consider Adjusted Free Cash Flow to be an indicator of our assets’ operating performance. In addition, this measure is useful to investors because it is frequently used by industry analysts, investors and lenders as a measure of valuation for broadcast companies, although their definitions of free cash flow may differ from our definition.
For a reconciliation of these non-GAAP financial measurements to the GAAP financial results cited in this news announcement, please see the supplemental tables at the end of this release.
With respect to our forward-looking guidance, no reconciliation between a non-GAAP measure to the closest corresponding GAAP measure is included in this release because we are unable to quantify certain amounts that would be required to be included in the GAAP measure without unreasonable efforts. We believe such reconciliations would imply a degree of precision that would be confusing or misleading to investors. In particular, a reconciliation of forward-looking Adjusted Free Cash Flow to the closest corresponding GAAP measure is not available without unreasonable efforts on a forward-looking basis due to the high variability, complexity and low visibility with respect to the charges excluded from these non-GAAP measures. For example, the definition of Adjusted Free Cash Flow excludes stock-based compensation expenses specific to equity compensation awards that are directly impacted by unpredictable fluctuations in our stock price. In addition, the definition of Adjusted Free Cash Flow excludes the impact of non-recurring or unusual items such as impairment charges, transaction-related costs and gains or losses on sales of assets which are unpredictable. We expect the variability of these items to have a significant, and potentially unpredictable, impact on our future GAAP financial results.
About Nexstar Media Group, Inc.
Nexstar Media Group, Inc. (NASDAQ: NXST) is a leading diversified media company that produces and distributes engaging local and national news, sports and entertainment content across its television and digital platforms, including more than 310,000 hours of programming produced annually by its business units. Nexstar owns America’s largest local television broadcasting group comprised of top network affiliates, with 200 owned or partner stations in 116 U.S. markets reaching 220 million people. Nexstar’s national television properties include The CW, America’s fifth major broadcast network, NewsNation, our national news network providing “News for All America,” popular entertainment multicast networks Antenna TV and Rewind TV, and a 31.3% ownership stake in TV Food Network. The Company’s portfolio of digital assets, including its local TV station websites, The Hill and NewsNationNow.com, are collectively a Top 10 U.S. digital news and information property. For more information, please visit nexstar.tv.
Nexstar Media Group, Inc.
Condensed Consolidated Statements of Operations
(in millions, except for share and per share amounts, unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Net revenue
$1,269
$1,240
$2,553
$2,497
Operating expenses:
Direct operating
552
537
1,100
1,075
Selling, general and administrative
215
213
431
431
Corporate
54
49
108
97
Depreciation and amortization
208
262
398
511
Total operating expenses
1,029
1,061
2,037
2,114
Income from operations
240
179
516
383
Income from equity method investments, net
16
32
35
57
Interest expense, net
(113
)
(111
)
(227
)
(218
)
Pension and other postretirement plans credit, net
7
10
14
19
Gain on disposal of an investment
-
-
40
-
Other expenses, net
(1
)
-
-
(1
)
Income before income taxes
149
110
378
240
Income tax expense
(43
)
(35
)
(105
)
(77
)
Net income
106
75
273
163
Net loss attributable to noncontrolling interests
12
21
20
44
Net income attributable to Nexstar Media Group, Inc.
$118
$96
$293
$207
Net income per common share attributable to Nexstar Media Group, Inc.:
Basic
$3.59
$2.68
$8.85
$5.71
Diluted
$3.54
$2.64
$8.71
$5.61
Weighted average number of common shares outstanding:
Basic (in thousands)
32,816
35,788
33,133
36,250
Diluted (in thousands)
33,287
36,314
33,656
36,878
Nexstar Media Group, Inc.
Reconciliation of Adjusted EBITDA and Adjusted Free Cash Flow (Non-GAAP Measure)
($ in millions, unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Net income
$106
$75
$273
$163
Add (Less):
Transaction and other one-time expenses(1)
-
4
1
11
Stock-based compensation expense
20
13
38
27
Depreciation and amortization expense(2)
137
142
275
284
Gain on asset disposal
(1
)
(7
)
(1
)
(7
)
(Payments) for broadcast rights(2)
(17
)
(23
)
(36
)
(50
)
Interest expense, net
113
111
227
218
Income from equity method investments, net
(16
)
(32
)
(35
)
(57
)
Cash distributions from equity method investments(3)
19
26
148
183
Pension and other postretirement plans (credit), net
(7
)
(10
)
(14
)
(19
)
Income tax expense
43
35
105
77
Gain on disposal of an investment
-
-
(40
)
-
Other
1
1
-
1
Adjusted EBITDA
$398
$335
$941
$831
Add (Less):
Cash interest expense, net
(110
)
(109
)
(221
)
(213
)
Capital expenditures
(37
)
(41
)
(81
)
(77
)
Payments for capitalized software obligations
(10
)
(10
)
(11
)
(12
)
Proceeds from disposal of assets and insurance recoveries
1
6
2
7
Operating cash income tax payments, net(4)
(164
)
(119
)
(166
)
(121
)
Cash contribution from noncontrolling interests
-
12
19
36
Adjusted Free Cash Flow
$78
$74
$483
$451
(1)
Primarily includes severance, legal and other direct expenses associated with our completed or proposed strategic transactions and/or acquisitions, any fees or other direct expenses associated with financing transactions, and severance and other direct expenses associated with restructuring activities.(2)
Depreciation and amortization expense excludes amounts related to amortization of broadcast rights for The CW (already deducted from Net Income (loss)). Payments for broadcast rights also excludes amounts related to The CW. By using The CW’s reported amortization of broadcast rights in our definition of Adjusted EBITDA, we match timing of revenues with the expense of the programming.(3)
Distribution received from our investment in TV Food Network LLC during Q1 2023 excludes $69 million, the portion that is related to its accounts receivable securitization program. As our investee stops or reduces the amount of accounts receivable it sells into the program and our distribution is reduced, we amortize that amount back into our Adjusted EBITDA and Adjusted Free Cash Flow. During the six months ended June 30, 2024, the amount related to the distribution received from TV Food Network LLC includes $9 million of such amortization.(4)
Excludes $11 million income tax paid during the three and six months ended June 30, 2024 related to the $40 million gain from the disposal of an investment. The proceeds from such disposal were also excluded from our definition of Adjusted Free Cash Flow.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240808320848/en/
Investor Contacts: Lee Ann Gliha EVP and Chief Financial Officer Nexstar Media Group, Inc. 972/373-8800 Joe Jaffoni, Jennifer Neuman JCIR 212/835-8500 or nxst@jcir.com Media Contact: Gary Weitman EVP and Chief Communications Officer Nexstar Media Group, Inc. 972/373-8800 or gweitman@nexstar.tv
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